How do the "Transfer" categories work for payments from PayPal to eBay?

Most eBay sellers pay their eBay Fees through their PayPal account. If you have both your eBay and PayPal accounts linked in GoDaddy Bookkeeping, you will notice that when you pay your eBay Fees through PayPal, two distinct transactions - one recording the sending of and one recording the receivingof funds - are imported by GoDaddy Bookkeeping in two distinct ledgers:

1. The sending of funds, from PayPal to eBay: this is imported by GoDaddy Bookkeeping into your Expenses ledger and categorized as a "Non-business, Transfer Out."

2. The receiving of funds, by eBay from PayPal: this is imported by GoDaddy Bookkeeping into your Income ledger and categorized as a "Non-business, Transfer In."

(If you are unfamiliar with the importance and nuances of the Transfer categories, please refer to this article: http://help.bookkeeping.godaddy.com/entries/20857762-what-do-the-transfer-categories-mean-transfer-in-transfer-out).

Remember: The cost occurred when eBay charged you the fees, not when you used PayPal to pay for them. Cost happens when you are charged for a service or item, not when you pay for it. Paying for it is a transfer.

When you usePayPal to pay for your eBay fees, you are simply moving positive value from one of your accounts (PayPal) to reconcile a negative value in another one of your accounts (eBay).

The costs have already been accounted for. You are just moving value from one account to another. This is a transfer, and it does not affect your reports, statements, or profit and loss calculations. This is why they are located in your Non-business ledgers in GoDaddy Bookkeeping.

Now, you may have noticed that the difference between a Transfer Out and a Transfer In follows a logical convention:

The Transfer Out category is used when money is sent from an account; it is used in the Expenses ledger only because it tracks value leaving.

The Transfer In category is used when money is received by an account; it is used in the Income ledger only because it tracks value arriving.

To review:

When PayPal pays eBay, the transaction data is imported by GoDaddy Bookkeeping and categorized as: Expenses: Non-business: Transfer Out

When eBay receives funds from PayPal, the transaction data is imported by GoDaddy Bookkeeping and categorized as: Income: Non-business: Transfer In

These transactions are two sides of the same coin. No pun intended. Or was it?